Register free!
Search
 
     

The Green Industry's Resource Center


Click for Weather
Reply
 
Thread Tools Display Modes
  #21  
Old 08-16-2014, 08:18 AM
whiffyspark whiffyspark is online now
LawnSite Fanatic
 
Join Date: Jul 2011
Location: Chesapeake beach
Posts: 5,256
Quote:
Originally Posted by LawnMowerMan2003 View Post
I know this is a little off-topic, but I've heard a few times on here that the profit is lowest with mowing. I've never thought to ask what had the highest profit?
The highest is subjective

But anything that tom, dick, and Harry can't do because of licensing, insurance etc.
Posted via Mobile Device
Reply With Quote
  #22  
Old 08-16-2014, 08:20 AM
Sprinkler Buddy's Avatar
Sprinkler Buddy Sprinkler Buddy is online now
LawnSite Senior Member
 
Join Date: Oct 2012
Location: Florida
Posts: 965
Quote:
Originally Posted by whiffyspark View Post
I recommend expanding from mowing. Mowing is really the bottom of the barrel and anyone can do it
Posted via Mobile Device
I knew I was doing something wrong all these years. lol
Reply With Quote
  #23  
Old 08-16-2014, 09:39 AM
snomaha's Avatar
snomaha snomaha is online now
LawnSite Senior Member
 
Join Date: Jan 2004
Location: midwest
Posts: 506
Quote:
Originally Posted by Kawizx62003 View Post
Yes that put my thoughts into words thanks. Any opinions on an acceptable percentage for this. Basically if my gross return is x%, I am running an operation that has a fighting chance. Right now the travel time is killing me but I know it will improve. Just wanna make sure I'm on the right track. I understand the mowing is the least but it's my baseline. Eventually I will find my cash cow. Just trying to get a good foundation. Once I have enough accounts for a crew then I will have the time to figure that out and have the manpower to try other things. Make sense?
Posted via Mobile Device
Starting with metrics early and understanding your financials will put you ahead of your competition.

I would echo what efficiency said - track your own time right now and attach a fair market wage to all time clock hours. Direct labor needs a cost attached, whether it's you or an employee.

As you grow, I think you will find that gross profit is your true economic engine. We measure revenue per employee (FTE) but feel GP per direct labor hour helps us the most. We take direct labor out of COGS then divide it into GP to get a labor efficiency ratio - based on past history we know what the ratio needs to be in order to hit our profit target.
Reply With Quote
  #24  
Old 08-17-2014, 09:05 AM
32vld 32vld is offline
LawnSite Gold Member
 
Join Date: Feb 2011
Location: LI NY
Posts: 3,097
Last fall clean ups I track the total costs, man hours, billable hours for every job.

That info made my estimating my clean ups this spring more accurate and more profitable.

Since last fall, including snow work, mow, fert, hedge trimming, an so on. I track the billable hours for all of my work and the actual time.

Also I track all non billable hours as well. For it is one thing to make $60 an hour. Example, though when you only produce 4 hours billable labor yet worked another 4 hours on non billable labor. Your billable average is $60 where your actual hourly income is $30.
Reply With Quote
  #25  
Old 08-18-2014, 05:14 PM
Kawizx62003 Kawizx62003 is online now
LawnSite Senior Member
 
Join Date: Oct 2012
Location: Transition Zone
Posts: 489
Thanks everyone. I found a great article today that helped some more with the math. Basically made a real budget (including my pay and 2 employees), got a total of costs. Took that and divided by expected amt of billable hours in the season to get my "cost per hour". Divided that by # of field workers (didnt include myself cause I wanted to see where the numbers were with me not doing field labor). Then I added in what I wanted my profit % to be and got my "per man hour amount (billable)". It was so simple. Then I compared it to my current pricing structure and saw the profit margin on each lawn size. I actually realized one of my prices for a certain size lawn size in my pricing structure was upside down by about 25%. So I decided to keep the price and lower the max lawn size. So now my profit margins look great for a real business (not a job).

Last edited by Kawizx62003; 08-18-2014 at 05:19 PM.
Reply With Quote
Reply

Thread Tools
Display Modes

Posting Rules
You may not post new threads
You may not post replies
You may not post attachments
You may not edit your posts

BB code is On
Smilies are On
[IMG] code is On
HTML code is Off

Forum Jump





Powered by vBulletin® Version 3.8.6
Copyright ©2000 - 2014, Jelsoft Enterprises Ltd.
Copyright ©1998 - 2012, LawnSite.comô - Moose River Media
All times are GMT -4. The time now is 09:53 PM.

Page generated in 0.07168 seconds with 9 queries